In his letter, Horner wrote: “As you well know, the HART Board needs an effective and constructive working relationship with both the City Administration and with the City Council. Hopefully, by my departure, as the Council Chair promised, the communications and appreciation for the many accomplishments of the HART staff will indeed strengthen.”

“As a non-politician, I don’t think it does any good shooting the messenger when he or she is delivering unpleasant news. That really doesn’t get to a solution,” Horner told KHON2.

Caldwell and Horner had scheduled Monday’s meeting weeks ago to discuss rail-related issues, and Caldwell admitted during a press conference that he had already been planning to ask for Horner’s resignation.

“I think that at this point, we need a new direction, a different form of leadership,” Caldwell said. “For me, I just want to make absolutely certain that there’s confidence in this project, and I’ve seen an erosion of confidence in this project, both by my administration, by the city council, as you’ve heard, and by the public at large. I think we have to rebuild that confidence, and I think a change in HART leadership, particularly as chair of the board, is a step in that direction.”

KHON2 reported last week that Honolulu City Council chair Ernie Martin called for both Horner and HART CEO Dan Grabauskas to resign, due in part to the spiraling costs of the rail project.

“All told, we are presently facing another shortfall of at least $348 million which could climb higher than $800 million. With mounting evidence of mismanagement and out of control costs, immediate consideration must be given to a reorganization of the HART board and taking the difficult step of asking for the resignations of both the HART Board Chair and CEO,” he wrote in a letter to Caldwell, dated Thursday, April 7.

“What about the financial concerns and issues that have been raised over the past couple of years,” KHON2 asked.

“I did my best as a banker. I’m not a politician. If anything, my shortcomings is probably I’ve been too candid and perhaps not politically correct often in some of my statements. But I do understand, I think, the numbers,” Horner said. “Rail is a myth that the quote cost overruns are a result of current work-in-progress, or because of excessive administrative overhead, or because of change orders.

“What Chair Martin asked me to do is promise that there’s additional funds. Respectfully, I make a distinction between a promise and a projection. That’s just the banker in me,” he added.

… Your letter singled out my performance as a HART Board member and used the term ‘mismanagement.’ Frankly, the letter came as a surprise since we had met a few days earlier, and your concern was not discussed. … My voting record and conduct as a Board member are a matter of public record and support the fact that I have fully performed my fiduciary Board responsibilities. You further cited a loss of faith in HART leadership because at a recent public Council meeting, I declined to ‘promise’ that future projected funding is sufficient to cover all project costs. This was characterized as a reversal (‘about face’) of prior testimony during the Bill 23 discussion. A fact check of my testimonies, will confirm that I made no reference to any change to the October 2015 Update which was used during the Bill 23 deliberations. In my non-political, business background, there is a distinction between a projection and a personal promise. If that distinction was poorly communicated, I do apologize.

At the Council meeting, I also pointed out that the project’s primary cost increase drivers are not coming from a lack of HART’s management of cost controls, change orders, work in progress, or excessive administrative costs but, rather revisions to construction cost growth rates for the remaining 55 percent of future construction, as well as, reaching agreement with HECO on estimating the final costs of utilities relocations.

Martin agreed that a solution would require cooperation among the board, city council and mayor: “With respect to the project, I think all of us are at fault for some of the hurdles we are currently facing.”

“It wasn’t a very easy decision for me to call for the resignation for both Mr. Horner and Dan Grabauskas,” but, Martin told KHON2 on Monday, it was a decision that had to be made.

Martin thanked Horner for his resignation and applauded his diligence and sincerity, however “I think it is time to move in a different direction,” he said. “I think we need to just be responsible, accountable and transparent, and be willing to make those tough decisions as necessary in order to move the project along.”

Martin said the council was often “left in the dark” with timely project updates and information. “I think he has been very reluctant to share that bad news with the council and in many instances we often find out about these issues from the press,” he said. “Just give me the truth and let us deal with it, and you who we have elected to make those tough decision, make those decisions.”

Horner was appointed by the mayor, which means the mayor is also responsible for Horner’s replacement, a process that Caldwell says has already begun.

“I do ask this. I’m going to be looking in the new HART board member that I select, that this person believes 100 percent in openness and transparency, number one. Number two, that accurate numbers are given at all times, not sugar-coated or under-reported type numbers. Those two things are critical,” Caldwell said.

Meanwhile, Caldwell added, Grabauskas is currently being evaluated by the HART board, as it ultimately is responsible for the hiring and firing of the executive director.

“I want to allow that evaluation to go forward. I think it’s their determination to decide what to do with the executive director,” Caldwell said.

“Do you think Grabauskas needs to do a better job of communicating?” KHON2 asked.

“I think so,” Caldwell said.

KHON2 asked Horner if Grabauskas should resign.

“Absolutely not,” said Horner. “Absolutely not. In my judgment, Dan has performed well.”

However, Martin says, now that Horner has stepped down, Grabauskas should as well.

“The model a lot adhere to is good news fast, bad news faster, and I think he has been very reluctant to share that bad news with the council,” said Martin.

Grabauskas has been HART’s CEO and executive director for the last four years. In his most recent performance evaluation, HART’s board praised Grabauskas for his “exceptional leadership skills.”

But the evaluation also pointed out the need for more effective and clear communication with the public and project stakeholders, and the board also felt there could be improvement in communication with board members, especially regarding potential problems.

“He always finds a way to talk about how he is responsible and answerable to the board, but you know what? He is accountable to the people of the City and County of Honolulu,” said Martin.

KHON2 did reach out to Grabauskas for comment, but we were told he was not available.

Horner, along with the other HART board members, is a volunteer and not compensated. He was appointed by Caldwell to a second five-year term on the board beginning July 1, 2015.

The 10-person HART board of directors is made up of three members appointed by the mayor, three members selected by the Honolulu City Council, and the city and state transportation directors. They collectively choose a ninth member from the community with the city’s director of planning and permitting serving as ex-officio, non-voting member of the board.

Mayor appointees:

William “Buzz” Hong, former executive director of the Hawaii Building and Construction Trades Council

Colleen Hanabusa, served on the Hawaii State Legislature, and served in the United States Congress.

City Council appointees:

Terrence Lee, a partner in the law firm Sullivan Meheula Lee

Damien Kim, business manager and financial secretary of the international Brotherhood of Electrical Workers Local 1186

Ivan Lui-Kwan, an attorney and director with Starn O’Toole Marcus & Fisher and a former city budget director

Other members designated by the charter:

City Department of Transportation Services Director currently Michael Formby

State Department of Transportation Director currently Ford Fuchigami

City Department of Planning and Permitting Director as an ex-officio, nonvoting member currently George I. Atta

The community member selected by the eight voting members is currently vacant.